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Kamal Narang

More by March: (From right) The Union Finance Minister, P. Chidambaram; the Minister of State for Finance, Mr Pawan Kumar Bansal; and the Chairman and Whole-time Director, Universal Sompo General Insurance, Mr O. N. Singh; at a press conference in the Capital on Monday. -

Our Bureau

New Delhi, Feb. 11 Universal Sompo General Insurance, a joint venture between Allahabad Bank, Sompo Japan Insurance Corporation, Indian Overseas Bank, Karnataka Bank and Dabur Investment, has entered the general insurance market with the launch of two policies.

The two products -- Standard Fire and Special Perils Policy and Aapat Suraksha Bima policy -- were launched by the Finance Minister, Mr P Chidambaram, here on Monday.

“Since the level of literacy is not very high in the country, the wording of the products must be simple and easily understandable for them to succeed in India,” Mr Chidambaram said after launching the products.

According to Mr O. N. Singh, Chairman and Whole-time Director, Universal Sompo General Insurance Co. Ltd, the standard fire and special perils policy covers assets against any damage or loss due to the perils of fire, lightning, impact damage, terrorism and other natural calamities.

“The policy is available for all occupancies, risk groups also for long term in case of dwelling (housing loan cases). However, with the policy wording expected to be deregulated with effect from April 1 this year, product variations will be designed at that time,” Mr Singh added.

Speaking about the Aapat Suraksha Bima policy, he said that it is a lump sum payment cover to financially support the insured or the nominee. “The policy is a benefit policy and hence the insured need not provide for proof of treatment cost whether these have been incurred or not. The critical illness cover is available for sum insured of Rs 25,000, Rs 50,000 and Rs 1,00,000,” he said.

The joint venture has been capitalised with shareholder fund of over Rs 235 crore, with a paid-up capital of Rs 150 crore.

While the foreign partner has a 26 per cent stake in the venture, the lead domestic partner Allahabad Bank has a 30 per cent stake, Indian Overseas Bank 19 per cent stake, Karnataka Bank 15 per cent and the rest is with Dabur Investment.

The company in the first year is looking at opening branches in 18 main cities across the country while also leveraging upon the distribution reach of the partner banks’ branches.

“In the first full year of operations (till April 2009), we are targeting a premium income of around Rs 150 crore and capturing around two to three per cent market share. Also, we are looking at launching around 28 products, which are in various stages of getting necessary approvals from the regulator, by the end of March,” Mr Singh told Business Line.

He added the around 30 per cent of the business will be from the retail segment, which includes motor, and commercial lines is expected to contribute a similar percentage. “The other 40 per cent is expected to come from SMB lines through bancassurance channels. However, we expect the business mix to undergo a change in line with market potential, especially in health and motor lines,” Mr Singh said.

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